- CPAIC says its examination revealed extensive inadequacies in the management of finances in Governor Fahim Twaha-led administration.
- They also wants the DCI and EACC to put the county under close surveillance owing to ‘fraudulent practices’
Lamu county could plunge into a cash crisis after a parliamentary watchdog committee recommended stoppage or reduction of their budgetary allocation over damning audit reports.
The Senate Public Accounts and Investments Committee (CPAIC) also wants the DCI and the Ethics and Anti-Corruption Commission (EACC) to put the county under close surveillance owing to ‘fraudulent practices’ going on there.
The committee chaired by Kisii Senator Samson Ongeri made the recommendations in its report on the scrutiny of the county’s financial and audit records for the last five years. The report was tabled in the Senate last week.
CPAIC says that its examination revealed extensive inadequacies in the management of finances in Governor Fahim Twaha-led administration.
“The committee noted that since the inception of devolution and for five successive financial years—2013-14, 2014-15, 2015-16, 2016-17 and 2017-18—the county executive of Lamu received disclaimers of audit opinions.
The nine-member committee noted that the county executive has been engaging in fraudulent practices, breached laws and procedures and are not submitting to auditors to aid in the auditing of its books.
In addition, their record-keeping is poor, a situation that has been worsened by the reluctance to recruit qualified finance personnel.
“The committee also reiterates its earlier recommendation in the fiduciary risk report that counties that will not show significant improvement in financial management arising from audit opinion will be penalised,” reads the report.
The committee recommended the county’s budgetary allocation be slashed by it losing on the fiscal responsibility parameter of the County Allocation of Revenue or releases of nationally collected revenue to the county stopped altogether.
The recommendation, if implemented by the National Treasury and Controller of Budget will deal a huge blow to the county that currently receives the least amount of Exchequer allocations.
In the current financial year, Lamu was allocated Sh2.59 billion— the least allocation—followed by Elgeyo Marakwet Sh3.86 billion, Tharaka Nithi Sh3.92 billion and Laikipia Sh4.17 billion.
In its report, the committee has indicted the county government over several questionable, unexplained and irregular expenditures and non-submission of financial documents to the auditor general.
The committee cited the ‘wasteful and doubtful’ expenditure of Sh6.09 million on legal services. The cash was paid out to a firm that was procured through restricted tendering without any explanation.
“The committee noted that wrong method of procurement was used to identify the provider of legal fees. Further, the payment for legal fees was done in advance before rendering of service, which was highly irregular,” reads the report.
Further, the county could not explain the expenditure of Sh5.29 million on the maintenance of vehicles. Another Sh9.69 million spent on the purchase of certified seeds were not supported.
“The committee observed that there was a breach of procurement law and procedures which may have resulted to loss of public funds,” the committee noted.
The committee also established that the county government could not substantiate expenditure of Sh12.26 million allegedly on purchase of office furniture and general equipment as there were no supporting documents.
In addition, the committee has put the county finance officials on the spot for operating 22 bank accounts with 11 of them at commercial banks.
The county also handpicked a supplier when it procured a governor’s official car – Nissan Patrol LE 2015 at a cost of Sh13.53 million.
“The committee noted the manner in which the county abuses single-sourcing method of procurement, in addition to flouting laid down procurement rules, guidelines and procedures,” the report says.
The county was also indicted for failure to explain expenditure of Sh15.35 million on purchase of specialised plant, equipment and machinery. “The committee recommends that the county governor and CEC finance should observe strict adherence to the law.”
Edited by Sarah Kanyara